ARIZONA FEDERATION OF TAXPAYERS

Expanding economic growth and prosperity for all Arizonans

June 26, 2005

Phoenix Tax Alert.  This Friday, July 1st at 9:00 AM the Phoenix City Council will vote whether to increase primary property taxes by 6.2 percent, or $5.2 million. The vote will occur at the Council’s last regular meeting before the summer.  Phoenix already has the county's highest property tax rates.  Increasing taxes only hurts the middle and working class families.

Taxes are being raised to pay for the latest big government fad of turning Phoenix into a "cool city," a place hip to singles, gays and the creative class.  We have debunked this exercise in central planning folly with our most recent report "Building a Prosperous Arizona: Time-Tested Truths for Economic Growth."  Join the Arizona Federation of Taxpayers this Friday, June 1st and fight for sensible, pro-economic growth policies.

Mesa Tax Update Part III.  A reader informs us of a statement made by Mesa City Councilman Kyle Jones:

"Unless you want a property tax, then you must use your taxes to build this." 

Get that.  If you do not pass the Riverview Dobson project, then Mesa will raise your taxes.  Of course, it looks like they will do that anyway.

June 22, 2005

More trolley-folly evidence.  Nationwide evidence continues to accumulate showing that rail transit is an ineffective, inefficient, and unfair use of taxpayer dollars. In a study released today by the American Dream Coalition, Rail Disasters 2005, transportation policy analyst Randall O'Toole finds that rail construction is usually accompanied by declines in overall transit ridership or growth in transit ridership that is slower than it would have been with a bus-only transit system. His conclusions are based upon ridership and other transit data published by the Federal Transit Administration, the American Public Transportation Association, and the Federal Highway Administration.

Meanwhile, Maricopa County marches forward with a plan to spend $2.3 billion (and counting) on light rail transit, despite abundant evidence produced during the debate over Proposition 400 that light rail will end up being a road to nowhere.  In Pima County, the Pima Association of Governments is planning to spend close to $300 million on streetcars.

June 21, 2005

Mesa Tax Update II.  A member informed us that Mesa's operating budget grew 8.1%, but when you add in the bond payments among other things, the total budget grew 10.2%. Mesa is indeed trying to tax itself to prosperity!

Important Meeting.  The Arizona Economic Forum will be having its annual conference in Flagstaff this weekend.  This is an interesting and provocative event with topics on runaway state spending and immigration.  Here is the program and you can contact Barry Aarons for more information.

June 18th, 2005

Your tax dollars at work.  The Goldwater Institute reports that state coffers are flush with our tax dollars.  But instead of returning it to the people who earned it, the Governor wants to spend it on projects of questionable value.  Goldwater President Darcy Olsen writes:

The governor's budget adviser suggests the money is needed for the "state's basic and most critical needs." Like such "critical needs" as classes for state employees in "self-massage," "tai chi," and "surviving the supermarket"? Please.

 

The budget has increased nearly 35 percent since Napolitano took office. There is clearly money to spare, money that should rightly be returned to the people who earned it.

Its time for a Taxpayer Bill of Rights in Arizona.  To find out more on this pro-economic growth measure visit our Resources section.

Mesa Tax Update.  Looks like all the special interest tax breaks and spending mismanagement has caught up with Mesa.  The City Council is considering a referendum on a property tax and an increase in the sales tax.  For the fiscal year 2005-06, the total city budget grew 10.2%, far outpacing the income growth of Mesa residents. 

Support council members Tom Rawles and Janie Thom who are fighting an uphill battle for responsible budgeting.  Pro-tax Councilwoman Claudia Walters is already playing the "starving children card", warning the city would have to shut down libraries, parks and recreation programs, pools or the arts.

Of course, the council could cut spending on free cell phones and the take-home use of government vehicles for city vehicles.  But as Napolitano would say, those are "critical services."

We need a Taxpayer Bill of Rights for Mesa.

Drug use and voting.  Is there a correlation between heavy marijuana use and voting?  There is according to this map.

Hat tip Espresso Pundit.

June 15th, 2005

Important meeting.  Approximately 84% to 87% of Arizona is owned by federal, state, local or tribal governments.  What little land is available for development has come under attack by environmental activists, who misuse environmental regulations to control private industry.  These excessive regulations and lawsuits result in higher costs for houses, food, gasoline and just about every other good and service. 

Join Cong. Rick Renzi in Pinetop on Saturday, June 18th for a rally on the National Environmental Policy Act.  Take action to make sure environmental policy is based on sound science, not scare tactics.  You can find more information here. 

June 11, 2005

If it's too good to be true...Supporters of the Mesa Riverview project said not to worry about a property tax increase, because for the last 50 years the city has made bond payments from the general fund.  Yet here is the Mesa City Council considering raising the secondary property tax without going to a voter referendum.  When a private sector company does that isn't it called bait and switch?

Housing Bubble? The rapid rise in home values has become a hot topic.  The Arizona Republic, true to its left-wing leanings, blames it all on greed.  Of course, its more complicated than that.  In the short-run, a lot depends on interest rates.  If the Fed raises rates, then demand is likely to taper off leading the market to a "soft landing," where home values flatten out.  If rates remain unchanged, then demand for homes will continue to rise until most homebuyers are priced out of the market.  That's when we are likely to have the "bubble burst" and see a drop in home values. 

Long-term, housing prices are a function of the net migration to a metro area (demand) and the availability of houses (supply).  As long as Phoenix continues to attract people with good jobs, low taxes and a great climate (excluding July), housing values will continue to rise.  The amount of new housing is limited by so-called "anti-sprawl" and "environmental" regulations.  These government barriers to development limit new home construction.  As a result, the supply of new housing is unable to keep up with demand.  Look for Phoenix metro home prices to continue to rise over the long-term.

Maybe our real estate agent friends can email us to shed some light.

She Lied.  Our first reaction was how could she!  But now, how could we expect otherwise.  The big question is what happens next year?  Does the legislature get any "deal" in writing, or does the legislature send one major package - accept it or veto it in its entirety.  Here's the notice sent to our members within hours of the Governor's deal-breaking veto.

May 24, 2005:

Great meeting.  Over 50 people listened to Bob Robb discuss current and future trends in Arizona politics and economics.  Despite stiff competition from the Phoenix Suns playoffs and the American Idol finale, Robb entertained the audience and answered their excellent questions.  

Do not miss our Annual Legislative Luncheon this fall.  Date and speakers to be announced soon.

Paths to prosperity.  Just released, the Arizona Federation of Taxpayer's latest report "Building a Prosperous Arizona: Time-Tested Truths for Economic Growth."

Arizona's central planners have been clamoring for Phoenix to become a "cool city," attractive to singles, gays and the creative class.  After light rail and the civic plaza expansion, now comes the $948 million ASU downtown campus.  If a "cool city" were truly what residents wanted, then New York City and San Francisco would be the fastest growing metro areas, and Phoenix would be losing population.  However, the opposite is true. 

We get more of what we reward and less of what we punish.  Such common sense should drive Arizona's fiscal policy.  Subsidizing unwanted activity (light rail) only punishes productive behavior.  Encouraging entrepreneurial activity, capital formation and the immigration of high wage, knowledge workers can be achieved in these simple steps:

• Low, simple tax code

• Minimal regulations

• Solid transportation infrastructure

• A quality education system

Accomplish this, and the rest takes care of itself.  Ireland and Singapore are two examples.

May 2, 2005:

Changed our mind, actually it was a success. For months, the AZ Republic has been sounding alarms over the "marginal returns" of the current and past $4.5 billion spent on downtown Phoenix projects. This was the justification for the need for a $948 million ASU expansion scheme.  In an about face, the Republic now touts their success.  Perhaps they have done polling on the giant sucking coming from downtown Phoenix.  So what is their proof of success?  In a metro area of 1.5 million people, 1,700 downtown lofts have been sold.  

April 11, 2005: 

Here they go.  Two weeks ago, the Arizona Republic ran puff pieces on the "success" of TGEN and other private-public partnerships.  This week's Viewpoints section in the Republic features a host of articles on creating a "smart" strategy for Arizona's future.  With few exceptions, that strategy is the same old line of more big government programs and all-day kindergarten.

Holistic strategy? People like Jonathan Talton continue to write how the lack of trendy night-spots and government "investment" puts Arizona at a disadvantage in recruiting high-wage talent workers.  Problem is, the stats disprove Talton's claim.  As Robert Robb correctly points out, people vote with their feet and Phoenix is the fastest growing metropolitan area.  The places that have instituted the policies Talton favors, experience comparatively low economic growth and a population exodus.

Kudos to Elliot Pollack, an Economic and Real Estate Consultant (link not available).  He cautions "instead of of attempting to pick winners and inadvertently heading us in the wrong direction, the government should set the stage for the private sector to perform to its full potential."  Indeed.

March 20, 2005:

Paths to prosperity.  The Arizona Federation of Taxpayers will be presenting a special report of the path to economic prosperity at our May meeting.  Our special guest will be syndicated columnist Bob Robb.